A Reuters report reveals based on internal Amazon documents that the company’s own products were pushed in India thanks to manipulative practices. The company also made various product copies.
Any accusation that Amazon uses its own data to manipulate the search results on the website in its own favor rejects the powerful one E-Commerce-Companies decidedly down. The same applies to allegations that Amazon is copying popular products for its own brands. But now the publisher has Reuters revealed in a reportthat Amazon’s internal documents appear to show the extent to which Amazon has used these practices in India. Reuters says it has analyzed thousands of pages, including email histories, strategy papers and business plans. They show that the company systematically copied products for the Indian region and manipulated the search results.
This is not the first time that the allegations have reached Amazon
As early as 2019, Amazon had to contend with allegations in which it said that the company was adapting the search results of its own e-commerce platform so that its own products were particularly highlighted. It was said two years ago that products that were profitable for Amazon should have been preferred in the report of the Wall Street Journal.
Now the company is again being sharply criticized. According to Reuters, which were obtained from the internal documents, Amazon had manipulated the search results pages in such a way that its own results always appear in the first two or three results. This emerges from a strategy report from 2016. Amazon itself had already stated in a statement in earlier corresponding allegations:
We display search results based on relevance to the customer’s search query, irrespective of whether such products have private brands offered by sellers or not.
However, this statement is reduced to absurdity by the documents viewed by Reuters.
#But it is not just the manipulation of search results that puts Amazon in a bad light. In particular, references to the systematic copying of third-party products raise suspicions of unfair competition.
Large-scale product copies – not just in India?
As can be seen in the report by journalists Aditya Karla and Steve Stecklow, Amazon employees in India used proprietary data from the Amazon.in website on the performance of other brands to provide so-called “reference” or “Benchmark“Products that could then be” copied “. In 2016, for example, a strategy called “Solimo” was introduced, which Reuters outlines as follows based on the documents viewed:
[…] use information from Amazon.in to develop products and then leverage the Amazon.in platform to market these products to our customers.
Still-CEO Jeff Bezos and the company knew that marketplace data on retailers was misused by Amazon for its own purposes always negated. However, had an investigation by the investigative publisher Politico pointed this out in the springthat Amazon may have known for a long time that seller data is used to optimize its own products. Now the debate about this practice is being put in a different light. Because the internal documents from India show that Amazon systematically relied on product copies. As an example, Reuters cites that the company cooperated with other brands in India in order to be able to manufacture new products according to the standards of the third-party brands. A document called “India Private Brands Program” contains the following wording:
It is difficult to develop this expertise across products and hence, to ensure that we are able to fully match quality with our reference product, we decided to only partner with the manufacturers of our reference product.
According to Reuters, these secretly implemented practices by Amazon to achieve their own business goals – such as the target set in 2016 to put 20 to 40 percent of products through its own brands in all product categories on Amazon, and that within two years – various responsible parties of the Company known. The stipulation for the employees was that they should only bring products onto the market that offer a higher margin than comparable reference brand products. Many of the own branded products now offered by Amazon in India are bestsellers according to the Amazon.in website. The Reuters report now lists various brands that have become victims of Amazon’s copying strategy in the Indian market – and react in shock.
Amazon has to face numerous allegations worldwide
the Allegations against Amazon increase after this report. The company is already being investigated in the USA, Europe and also India for possible moments of unfair competition. An investigation carried out in the USA by the head of the Federal Trade Commission (FTC), Lina Khan Amazon is currently fighting back. The reason: Khan is not impartial because she has done with one in particular in the past scientific article attracted attention, in which she argued that the previous procedures for assessing the competitive position of companies like Amazon did not work.
The knowledge that Reuters was able to draw from the internal Amazon files should be of interest to the FTC, but also to the European Commission. Latter also examines the antitrust dimension of Amazon’s use of data to optimize its own business. A member of the Amazon press team told OnlineMarketing.de in spring 2021 (as a result of the aforementioned Politico Report):
The assumptions some media have drawn from this audit are false and misplaced. Amazon is proud to be particularly transparent compared to most other retailers by providing robust data including detailed popularity rankings, reviews, and star ratings for every product in our store. On top of that, we provide sellers with tools that share data to help them identify selling opportunities and sell more products in Amazon’s stores. Amazon’s Seller Data Protection Policy was voluntarily adopted years ago to give sellers comfort regarding treatment of their individual data. It goes well beyond any legal requirement, and we are not aware of other retailers with a similarly protective policy.
The next few months will have to show to what extent the various investigative authorities can now use the content published by Reuters to pursue new investigative approaches. At least there are relationships between the enormous growth of Amazon and theirs huge growth market India and strategic corporate decisions become more apparent. The allegation of abuse of market power by Amazon to increase sales is again obvious in view of this relationship.
All information on the internal documents and the conclusions that can be drawn from them can be found in the Reuters report. Various examples of Amazon’s practices are also listed there.